1．Copper Inventory in Major Chinese Markets Fell 6,900 mt on Week

  As of May 20, copper inventory across major Chinese markets dropped 6,900 mt from Monday to119,900 mt, a decrease of 1,000 mt from last Friday.Compared with the data on Monday, the inventory in most regions of China this week fell, while the inventories in Shanghai and Zhejiang rose slightly.The total inventory fell 232,700 mt from the same period last year when the inventory was recorded at 352,600 mt. This week, because the arrival of imported copper in Shanghai increased, and the logistics shipped outside the city have not fully recovered, the inventory in Shanghai rose slightly. In Guangdong, since mid-week, special railway lines needed to be repaired, which leads to a decrease in arrival and inventory.    The inventory in Jiangsu rose due to the increase in pick-up aroused by the recovered downstream consumption.    Stimulated by the maintenance of smelters in the north and the improved local consumption, the inventory in Tianjin continued to drop.  

Looking forward, the arrival of imported copper will increase next week.    Besides, the supply will rise as the railways in Guangdong will return to normal.    However, the consumption may weaken as the end of the month approaches.    Therefore, SMM expects that the weekly inventory next week will increase slightly.

 

 

 

 

 

 

 

 

2.Copper Inventory in Bonded Area Decreased 12,300 mt on Week

Copper inventories in domestic bonded zone decreased by 12,300 mt to 309,700 mt from May 13 to May 20, according to SMM survey.  Inventory in the Shanghai bonded zone decreased 5,700 mt to 284,300 mt, and inventory in the Guangdong bonded zone dropped 6,600 mt to 30,400 mt. Importers, who locked in the prices when the import was profitable, continued to transport the goods in bonded zones to China this week,  causing the inventory of bonded zones in Shanghai and Guangdong to decline.  In addition, it is known that there are still many traders who are waiting to pick up goods in bonded warehouses in Shanghai, so the inventory is expected to drop further.

 

 

 

 

2. Yangshan Copper Premiums were Stable with some Downward Potential amid a Dropping Price Ratio

Yangshan copper premiums stood at $69-85/mt under warrants today.  The average price was $77/mt, $1/mt lower than the previous trading day.  Quotes under B/L stood at $60-80/mt.  The average price was $70/mt, $1.5/mt lower than the previous trading day with the quotation period in June.  The quotation refers to the prices of goods arriving at ports in late May and in the first half of June.  The premiums of LME 0-3 were $45/mt.  The import losses were around 600 yuan/mt over the 2206 copper contract as of 10 a. m. today.

 

Today, the import losses expanded as LME copper inventory dropped and the carrying fees of LME copper rose.  According to the survey today, LME copper was still in the backwardation structure.  Warrant traders had a strong willingness to ship goods under the pressure of capital cost.  Different brands of high-quality copper were quoted at $85/mt or $82/mt.  Quotes of mainstream pyro-copper were $84/mt, and hydro-copper was quoted at $75/mt.  The market was still sluggish.  On the bill of lading front, at present, documents stuck in express delivery can be transferred.  The recovered logistics picked up offers and inquiries in the market.  In the early trading, the prices of high-quality copper were $80/mt, and Japanese and South Korean pyro-copper were quoted at $75/mt.  There was no transaction in the market yet.

 

The high-quality pyro-copper premiums were around $85/mt under warrants, and mainstream pyro-copper and hydro-copper were quoted at $78/mt and $69/mt respectively.  The high-quality copper under the bill of lading was quoted at $80/mt, and that of mainstream pyro-copper and hydro-copper were $75/mt and $60/mt respectively.

 

 

 

 

 

3. Imported Copper Market in Shanghai Bonded Zone Was Subdued amid Closed Import Profit Window, But Traders Held Offers Firmly

Yangshan copper premiums were $62-84/mt under warrants today, with the average flat from yesterday, and were $49-70/mt under B/L, with the average also stable, both with QP in June.  Import losses were around 500 yuan/mt against the SHFE 2206 copper contract.

With the import window closed, the market trading was sluggish.  There were much more offers than inquiries from buyers.  Sellers held offers firmly due to expectation of the recovery of logistics, while buyers do not accept current premiums, thus few deals were heard.

 

 

4. The INE Bonded Copper Contract Prices Rebounded amid Improved Market Sentiment

The INE bonded copper 2207 contract showed an upward trend overnight overnight.After the opening, it fell to 63,490 yuan/mt, then fell slightly near the close and finally closed at 63,420 yuan/mt, up 130 yuan/mt, or 0.21%.

The trading volume was 6,065 lots yesterday, and open interest decreased by 3 lots to 13,451 lots. On the macro side, the domestic government has stated that it will introduce more policies to stimulate the economy and stabilize growth.   In addition, the improvement of the pandemic in Shanghai has greatly improved market confidence and pushed copper prices to rebound.   It is expected that copper prices will run at 63,400-63,800 yuan/mt today.